Question

Which of the following statement is not correct in relation to 'Franchise'?

• A. Franchising is the practice to use the another firm's successful business model.
• B. It is the business relationship between two organisations where a franchiser, who is the owner of a brand name, product or system of a business, permits a franchisee to use its brand, product or business process for a free.
• C. The franchisor provides training and continuous assistance to the franchisee.
• D. Franchiser shares all business and trade secrete with franchisee.

Answer 1

Answer: (D)

• Franchising is a “form of licensing in which a parent company (the franchisor) grants another independent entity (the franchisee) the right to do business in a prescribed manner. This right can take the form of selling the franchisers products, ‘using its name, production and marketing technique, or general business approach.” Donald W. Hackett
  
• Franchising is the practice to use the another firm's successful business model.
  
• The franchiser provides training and continuous assistance to the franchisee.
• Franchiser need not share all business and trade secrete with franchisee.